Estate Planning For the Newly Married

Needham Estate Planning

Now is the perfect time to start working on an estate plan—because, as newlyweds, you may not have a list of your accounts, but you've effectively just done a working inventory of your possessions—as you've figured out how to consolidate two households into one.

You've already been working on the new banking and shared the responsibility of bills and taxes and so forth.

Use that all time and energy and work as a leapfrog into planning for your future—so you'll be that much more prepared for the house, the kids, and the next stages of your new life together.

Why Think About Estate Planning At This Point?

Even if you have few assets, as we just talked about, you have more than you think.

Still, putting together a will or a trust probably is very straightforward at this point, since you just did that accounting of your collective assets.

You may have heard of state laws that give your property to a spouse if you don't have a will.

These laws—known as intestacy laws—vary by state and can sometimes have results you wouldn’t expect.

And, intestacy requires your estate going to probate—a court proceeding that can take months, even years, to resolve. So a basic estate plan should give you some peace of mind—knowing loved ones are taken care of if anything should happen.

You can even plan for the property you don't yet own (a house you may buy someday) and provide for children whenever they arrive on the scene.

And once you have that initial plan in place, you can easily update it as your circumstances and needs change.

Furthermore, if you already have a sizable amount of assets then estate planning may lead to tax benefits, now and in the future.

Who Can Make Decisions For Me, If I Can't?

In the U.S., a power of attorney (POA) is a legal document that designates someone else (often a spouse) to make financial and other decisions on your behalf.

In the financial realm, a POA can sign contracts, file lawsuits on your behalf, and more. Depending on the exact language, you can grant the POA broad powers, or something more limited to an issue or situation.

One specific form of POA is in effect only if you are unable to make decisions on your own—such as an emergency or illness.

And you can have that type of POA for both the financial side of things, as well as one relating to your medical care.

What Kind of Care Would I Want?

An advanced directive (also known as a living will) is a document that makes clear the kinds of medical interventions you'd prefer if you're unable to make decisions for yourself. In some ways, think of this as an emotional insurance policy:

You make decisions now, so the people you love won't have to. This can also make it easier for your spouse to make decisions if necessary, as long as you name them as a medical decision maker.

Who Will Look After The Kids?

If you don't yet have kids but want them someday, realize that an estate plan is essential for families with children.

The state statute providing assets for a spouse will probably also include some inheritance for children.

However, when it comes to guardianship, you need a will to designate caregivers for the children, should something happen to both parents.

Without a will, the court decides on the children's caregiver, and the court may select someone you don’t want.

As you start your new life together, one of the best ways to begin is by planning for the future, and whatever it may bring.

We've been helping families of all ages and kinds for decades, and we'd be delighted to help you, so contact our professionals today.

Lifetime and Deathtime Planning… and Why a Comprehensive Plan Must Include Both

According to a March 2017 survey by Caring.com, six out of ten Americans have no will or any other kind of estate planning. Many said they’d get around to it, eventually. When they’re old. (The survey did find that the elderly are much more likely to have some plan in place.) It’s all too clear that most of us think “estate planning” is a euphemism for “deathtime” planning. Indeed, in the Caring.com survey, one-third said that they didn’t need an estate plan because they didn’t have any assets to give someone when they’d died.

However, comprehensive estate planning isn’t just deathtime planning. It’s lifetime planning, too. It’s about ensuring that your medical and financial decisions can be made by someone that you trust. Lifetime planning can help you address potential tax liabilities, find you benefit programs you may eligible for, and protect your family from costly guardianship or conservatorship court. It can make sure that a trusted party looks after and protects your affairs, if and when you’re not able to.

Lifetime Planning Tools

As estate planners, we have an arsenal of lifetime planning tools to benefit clients, and we can custom-tailor such plans to an individual’s needs. Here are a couple of the most common (and necessary) lifetime planning tools you should discuss with us.

Revocable trusts

When people hear the word “trust,” they may think of “trust fund babies” or think that trusts are something only for the super-rich.

However, a trust is simply a legal tool that can help almost anyone with property – not just the wealthy. In a trust, assets you own are re-titled and transferred into the trust. When this happens, technically, you no longer own your real estate, stocks, bonds and similar properties. Instead, the trust owns them all. But you still control everything in the trust: You can buy and sell these assets as if they were still in your name. In fact, revocable living trusts don’t even change your income taxes while you’re alive. You continue to file your tax returns as you always have, making them very easy to administer while you’re alive. And as the creator, or settlor of the trust, you can continue to make changes to the trust as long you’re competent to do so.

Once you die, the trust becomes irrevocable, meaning its terms can’t be changed. At this point, your chosen successor trustee distributes assets to beneficiaries (the people, such as your spouse, children, a church, or other charity, you named to inherit from you). In many respects, the role of the trustee is similar to that of the executor of a will. But, a trustee of a fully funded trust doesn’t have to go through the public and expensive probate process. Trusts are private unlike wills, which can also provide valuable privacy to your family.

Durable power of attorney

Durable powers of attorney come in two forms. With a standard durable power of attorney, a person is legally designated to act on your behalf, in the ways specified in the document. You can make the durable power of attorney broad in scope or quite limited, and it becomes active as soon as you sign it. Under this document, the person may sign checks for you, enter contracts on your behalf, even buy or sell your assets. What they can do depends on what you authorized in the document.

In the case of a “springing” power of attorney (POA), also known as a conditional power of attorney, the person only has this authority if you become incapacitated. At that point, the POA “springs” into action.

There is no “best” power of attorney. We’ll work with you to determine which is the best fit for your needs and goals.

Health Care Power of Attorney

In an instant, an accident can change a healthy, vigorous person into someone who can’t make her healthcare decisions. Others face a long decline in mental capacity because of a disease like Alzheimer’s. In either case, you want to empower those you trust to make medical decisions for you. Though health care legal documents vary somewhat by state, the general principle is that, through this document, you authorize someone to make medical decisions for you, if and when you no longer have the capacity to do so. You can also communicate your desired treatment and end-of-life care. However, those instructions may not be valid in every state.

A Holistic Approach

Lifetime planning is a comprehensive approach to estate planning. And while it addresses needs of the living, comprehensive planning may also improve the after-death part of your plan as well, because it can reduce family conflict and preserve assets against court control or interference in the event of incapacity.

Contact an Experienced Estate Planning Attorney

For insight into how to establish a trust and implement other lifetime planning options, call us today to schedule a consultation.